A.S. Pharma Pvt Ltd Vs Nayati Medical Pvt Ltd & Ors. (Supreme Court of India)
Conclusion: Supreme Court held that High Court was bereft of the power to quash a case under Section 138 of the Negotiable Instruments Act, using the powers inherent to it under Section 482 of the Code of Criminal Procedure, 1973, as long as there was no consent from the complainant. The position was ‘that an offence under Section 138, N.I. Act could be compounded under Section 147 thereof, only with the consent of the complainant concerned’
Held: Appellant filed a Complaint Case alleging commission of offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) against the respondents. On receipt of the summons, the respondents appeared before the Court and expressed their readiness to settle the matter by effecting the payment. An application to permit to compound the offence was filed under Section 320 of the Code of Criminal Procedure, 1973. The Trial Court had dismissed the same as per order. Aggrieved by the order of Trial Court, respondents took up the matter before the High Court challenging the order dismissing the application for compounding the offence under Section 138, N.I. Act also seeking quashing of and all further proceeding thereon. The core contention of the appellant was that an offence under Section 138 of the N.I. Act was not compoundable under Section 320 Cr.P.C., and in such circumstances, the application was rightly dismissed by the Trial Court. Invoking the power under Section 482 Cr.P.C., coupled with those under Section 147, N.I. Act, the High Court ought not to have compounded the offence without the consent of the appellant. It was held that the question whether the offence under Section 138, N.I. Act could be compounded invoking the power under Section 147, N.I. Act, without consent of the complainant concerned, was no longer res integra. The position was ‘that an offence under Section 138, N.I. Act could be compounded under Section 147 thereof, only with the consent of the complainant concerned’. With respect to the deposit of the amount payable by the respondent, the fact that the dishonored cheques were respectively for Rs.3,00,000/-and Rs.3,50,000/- and upon receiving the summons, the respondent-accused had expressed their readiness to effect the payment and to settle the matter, there was no point in restoring the proceedings and to permit their continuance before the trial Court, though the impugned judgment was set aside to the extent it compounded the offence under Section 138, of the N.I. Act, invoking the power under Section 482, Cr.P.C., and Section 147, N.I. Act. Hence, despite the lack of consent from the appellant-complainant, it was a befitting case to invoke the power of this Court under Article 142 of the Constitution of India to do complete justice between the parties and to quash Complaint Case as also all proceedings emerging therefrom. Hence, Complaint Case pending before the Court and all the further proceedings therefrom stood set aside and quashed. Appellant-complainant would be entitled to withdraw, in accordance with law, entire amount in deposit before the trial Court viz., Rs.6,50,000/- along with 12% simple interest per annum from the date of the cheque in question till the date of actual payment along with the additionally paid Rs.1,00,000/-.
